Can mechanism design save democracy? We propose a simple design that offers a chance: individuals pay for as many votes as they wish using a number of "voice credits" quadratic in the votes they buy. Only quadratic cost induces marginal costs linear in votes purchased and thus welfare optimality...

This online appendix to "Insulated Platform Competition" includes proofs and details of our applications.The paper to which these Appendices apply is available at the following URL: "http://ssrn.com/abstract=1694317" http://ssrn.com/abstract=1694317

Standard policies to correct market power and selection can be misguided when these two forces co-exist. Using a calibrated model of employer-sponsored health insurance, we show that the risk adjustment commonly used by employers to offset adverse selection often reduces the amount of...

Selection markets, like insurance and finance, where the value of customers depends on their identity, create fundamental challenges for competition policy. Competition is often harmful in these markets either by creating socially excessive supply or leading to degradation of product quality....

Policies to correct market power and selection can be misguided when these forces co-exist. We build a model of symmetric imperfect competition in selection markets that parameterizes the degree of market power and selection. We use graphical price-theoretic reasoning to characterize the...

To mitigate adverse selection in insurance markets, individuals are often mandated to buy at least a baseline plan, but may choose to opt into a premium plan. In some markets, such as US health exchanges, each plan is responsible for the full expenses of those who buy it (“total pricing”)....

I document empirically that the field of financial economics has been mostly concerned with positive issues (largely related to “informational efficiency” of prices) rather than allocative efficiency relative to the field of industrial organization, which I take as a comparison point. I...

Does competition promote efficient platform pricing and market structures? We model imperfect platform competition using a new approach, Insulated Equilibrium (IE). Building on the observation that platforms often charge low prices to build a "critical mass", IE assumes platforms use...

Einav, Finkelstein and Cullen (2010) find small welfare costs of adverse selection into a premium and out of a baseline health insurance plan offered by an employer. In their model, only the premium plan is required to break even and we argue this drives their conclusion: if the baseline plan...